Seasons Construction is constructing an office building under contract for Cannon Company. The contract calls for progress billings and payments of $1,240,000 each quarter. The total contract price is $14,880,000 and Seasons estimates total costs of $14,200,000. Seasons estimates that the building will take 3 years to complete, and commences construction on January 2, 2014. Seasons Construction completes the remaining 25% of the building construction on December 31, 2016, as scheduled. At that time the total costs of construction are $15,000,000. What is the total amount of Revenue from Long-Term Contracts and Construction Expenses that Seasons will recognize for the year ended December 31, 2016?
Revenue ________________________Expenses:
$3,750,000...............................$ 3,750,000
$14,880,000.............................$15,000,000
$3,720,000...............................$ 3,750,000
$3,720,000...............................$ 4,200,000
Total contract price multiplied by % construction completed.